The Hillsborough County Aviation Authority (Authority) is an autonomous county administrative unit that operates four airports, the most important of which is Tampa International Airport (TPA). Currently, TPA occupies 3,300 acres west of downtown Tampa with three runways serving 16.7 million passengers annually. The largest carriers are: Southwest/AirTran with 40% of traffic; Delta with 18% of traffic; and US Airways & American with 10% of traffic respectively. Passenger traffic is still down by over 12% from a recent high of approximately 19.3 million passengers in 2007 (“A New Day in Tampa Bay,” 3-8).

The current TPA Master Plan calls for significant improvement of airport facilities in two phases between 2013 and 2023 at a total projected cost of approximately $1.2 billion. Expansion will then take place in a third phase from 2020-2028 at a projected cost of an additional $1.2 billion. These improvements are intended to double passenger capacity to 35 million passengers annually, improve passenger foot traffic through the airport, and expand international flight offerings (“A New Day in Tampa Bay,” 16-41). However, the plan only gives minimal attention to expanded cargo operations.

Potential Economic Impact

The Authority projects that Phase I and II will provide in excess of 13,000 jobs, presumably directly and indirectly, as a result of the expansion and that Phase III will provide at least another 13,000 jobs. (“A New Day in Tampa Bay,” 17, 33, 36). The majority of these jobs are likely to be in the construction, retail, management, and administrative sectors. According to 2012 data from the US Census Bureau, Hillsborough County has a population to employment ratio of 2.5, meaning that there are 2.5 residents for every one job in the county. Thus, the creation of approximately 26,000 jobs could be expected to result in over 65,000 new residents and 20,000 new households. Assuming the Authority’s projections are realistic, this increase in population would lead to increased residential and retail demand in neighborhoods within commuting distance to TPA.

Neighborhoods within a fifteen minute to commute to TPA are likely to experience the greatest increase in demand. These neighborhoods include: Town ‘n’ County; Egypt Lake-Leto; Carrollwood Village; Downtown; and, South Tampa. Of course, which neighborhoods will see increased demand depends on the quality of jobs created as a result of the expansion. The Authority hasn’t made available a breakdown of projected median salaries or industry sectors for the projected jobs. However, the data that have been provided suggest that the transportation and warehousing sector will not be well-represented. Most demand should be in the residential, retail, and service sectors.

Cost-Benefit Analysis

The Master Plan essentially provides an input-output analysis of the economic impact of airport expansion (i.e., dollars in, jobs out). This model is only one of the several ways to measure the economic impact of airport expansion. The issue of properly analyzing airport expansion was explored extensively by Senior Vice-President of the St. Louis Federal Reserve Bank Cletus C. Coughlin and Professor Jeffrey P. Cohen of University of Hartford in their paper entitled, “Congestion at Airports: The Economics of Airport Expansions.” Cohen and Coughlin note that the primary shortcoming of the input-output analysis is that it focuses on short term demand and often ignores the underlying economic reasons for the project. Ultimately, the expansion project should deliver intermediate inputs to produce goods/services for use by private business or completed goods/services for consumption. Therefore, it is not sufficient to focus solely on a final jobs numbers as a valid measure of economic impact.

The FAA generally requires an extremely comprehensive cost-benefit analysis prior to the approval of any expansion. As part of this extensive analysis, the Authority is required to identify alternative courses of action, such as: increasing capacity for alternative modes of transportation, airfield re-alignment, utilizing a multiple airport system, etc. (Cohen & Coughlin, 17-18). The Authority is then required to compare the net present value of the various alternatives in order to justify the decision to expand. (Cohen & Coughlin, 19). Generally, the alternative with the highest net present value is recommended as the project to be undertaken, however the sponsor (i.e., Authority) may proceed with a different alternative if it provides important intangible benefits or is substantially less risky. A thorough examination of this issue is outside the scope of this paper, but, it is important to be aware that a thorough examination of the expansion and any alternatives are required and the Authority has chosen expansion, which may or may not have the highest net present value of all of the options available.

Industrial Opportunity in Tampa?

Jones Lang LaSalle published its 2013 U.S. Airport Outlook (Outlook) recently. Although it notes that total cargo volume growth across the nation is somewhat anemic, it notes there are opportunities to cater to certain end-users tied to growing trade lanes and expanding e-commerce. The Outlook rated Miami International Airport as having the second-highest air cargo score, the second-highest industrial real estate score, and the highest overall score (Jones, 11). The air cargo score rates the health and growth of the airport, as well as functionality and connectivity, whereas the real estate score measures industrial market metrics within three miles of the airport. The primary reason for Miami’s high rating is international cargo traffic between the U.S. and Latin America, particularly in the area of floral and perishable food trade (Jones, 12). While air cargo transportation has suffered generally due to the cost-effective nature of transportation by sea and by rail, the time-sensitive nature of food and flowers means that they continue to be a major component of air cargo (Jones, 7).

Miami International Airport handles over 1.8 million metric tons of air cargo metric tons of air cargo in 2012, whereas TPA handled only slightly more than 80 thousand metric tons of cargo, more than 20 times less than Miami (Jones, 12; Tampa Int’l Fact Sheet 2012). The continued growth of Florida as a gateway to Latin America provides significant opportunity for industrial expansion, particularly in light of the large volume of perishable food importation from South America. The question is, can Tampa begin to penetrate the dominance of Miami?

I contacted Janet Zink of the Tampa Airport Authority who directed me to the various Master Plan sections for TPA dealing with cargo. According to Volume 1 of the 2012 Master Plan, the forecast for growth of air cargo at TPA is projected in the following chart:

The Authority also directed me to Volume 2 of the Master Plan, which indicates FedEx is currently the only large air cargo carrier utilizing TPA. Additionally, there are no immediate plans for expanding cargo handling facilities at TPA, other than to reserve land for unforeseen growth in cargo operations. Thus, cargo growth is expected to be slow but steady and unlikely to result in increased industrial demand near the airport. However, given the increase in trade agreements with Central and South American countries for air-transported produce, I believe there is a strong possibility for growth, particularly considering Tampa’s strategic location within one driving day of Atlanta. The question is will local leaders look beyond the conservative projections and pursue the possible new cargo business aggressively? That remains to be seen.

About the Guest Author:

Jason Quick is a native of Southwest Florida and graduate of UCF and the Wake Forest University School of Law. He is currently a Master of Science in Real Estate candidate at the University of Florida and resides in Tampa, Florida with his wife, Jillian. After spending several years as an attorney with a federal agency in Raleigh, NC and Philadelphia, PA, Jason made the decision to return to Florida and pursue his passion for real estate as a full-time career. His interests include leasing and brokerage as well as residential development. Jason can be reached by email at jasondquick@gmail.com.

Like a phoenix rising out of the ashes, can the return of retail and entertainment areas within Tampa’s downtown core be sustainable? With the impending bankruptcy sale of Channelside Plaza to the Tampa Port Authority being delayed by legal proceedings, this is the question that many residents and investors are asking. Tampa is not alone in devoting downtown space to retail and entertainment complexes that are meant to drive economic activity. Roughly 200 miles southeast of Tampa, West Palm Beach provides an example of downtown retail revitalization that has seen its share of ups and downs since its development. Over the last 50 years the flight to the suburbs have driven both population and its correlating retail establishments to areas located on the city fringe. Tampa is no exception to this phenomenon. Like all retail locations, the proper mix of tenants is necessary to facilitate the consumer traffic necessary to make downtown projects viable. Examining population trends, the successful tenant mix, and looking at West Palm’s CityPlace, may provide the proper clues necessary to determine the future vitality of downtown Tampa. Recently, Mayor Bob Buckhorn released his InVision Tampa plan, which allocates state and federal funds to the redevelopment of a wide area of underutilized space. In creating a framework for his plan, Mayor Buckhorn enlisted the help of the Urban Land Institute to highlight opportunities and challenges facing the downtown core. This article will highlight some of the issues noted by ULI’s study.

According to a University of South Florida demographic report using 2010 census data, the city of Tampa had approximately 330,000 people within its borders and Hillsborough County had a population of 1,225,000 (“Population”). Comparing these numbers to the 2000 census data yields some interesting results. The population growth within the city of Tampa over this 10-year period increased 10%; the growth rate for Hillsborough County was over 20%. While the relatively sluggish growth of downtown population relative to Hillsborough County could be a major area for concern, one must consider the impact of tourism on downtown Tampa. Visit Tampa Bay (formerly Tampa Bay and Company) reports that in 2010, Tampa welcomed 13.9 million visitors with roughly $3 billion dollars worth of revenue generated (Claytor). Certainly, an increase in total number of visitors is likely in 2013 due to a more favorable economic climate. Will these visitors patronize retail areas in the CBD on a consistent basis? One can look to downtown events such as concerts or hockey games at Tampa Bay Times Forum or events at the convention center, but this is a relatively small and transient population to create continued support needed to create economic vitality of downtown retail establishments. A more promising sign that downtown population can support a healthy retail market is the increase in condo development. Channelside and downtown have seen a steady increase in residential development since the real estate boom of the early 2000’s and during the most recent economic recovery. One need look no further than Related Group’s, Pierhouse, a $55 million dollar Channelside project that will feature over 350 apartments. Population and retail success go hand-in-hand. All signs point to the increase in downtown population, which will lead to future success of retail establishments.

One of the issues highlighted by Urban Land Institute’s study is creating a mixture of tenants that support a variety of retail including locally owned boutiques, credit tenants, and new initiatives such as pop-up retail projects. A Tampa Bay Times article titled, “Vision for Tampa’s Future Connects Downtown, Channelside,” highlights the need for a mixture of tenants and one type of retail that might catch people by surprise: a grocery store. The authors conclude that bringing in a grocery store such as Publix into downtown would draw a large population from surrounding areas, and such a move could foster further retail development (Thalji, Harwell, and et al). Tampa has already taken steps to bolster innovative trends in retail. Karma, a yearly pop-up retail event featured at Channelside Plaza, hosts local business owners who sell fashion, jewelry, and other items. The event coincides with Tampa Bay Fashion Week. Such initiatives are the foundation for creating permanent, successful retail establishments. Creating the right blend of shops and restaurants is a crucial step in the right direction. Such exploratory measures will not be without cost and time. Nonetheless, creating an environment that draws people into the city as opposed to other areas such as WestShore will have positive ripple effects throughout downtown.

As a resident of Palm Beach County and a frequent visitor to both Tampa and West Palm’s downtown districts its hard not to notice similar problems and areas of opportunity. Once an underdeveloped, crime prone neighborhood on the west side of West Palm’s downtown, the development of a dedicated retail and entertainment complex that draws in residents from all over the county, CityPlace provides a real life example of downtown rejuvenation that has seen both initial failure and long-term success. A Collaboration amongst several developers including the aforementioned Related Group, CityPlace has created over 3,000 new jobs, increased taxable property value by $5 billion, and attracts nearly 7 million visitors a year since its creation around 2000 (“CityPlace Celebrates 10 Years as an Economic Engine in Palm Beach County”). CityPlace’s success from a retail perspective can be attributed to the right mix of tenants that took a better part of a decade to achieve. Anchored by Macy’s, a large movie theater, Barnes & Noble, Publix, and a host of well-known restaurants, residents and visitors alike frequent the area repeatedly. CityPlace works because of its repeat customer base and idyllic environment. Channelside must also take advantage of its beautiful weather, serene waterfront views, and creating a project that bolsters repeat patronization.

The secret to CityPlace’s success in light of early hurdles can be attributed to the support of Miami Dolphins owner Stephen Ross who pledged both time and money ensuring CityPlace’s vitality. A similar story is waiting to be written for Channelside, this time in the form of Tampa Bay Lightning owner Jeff Vinik. Mr. Vinik’s investment in the area surrounding Channelside Plaza makes him the key to downtown Tampa’s future success. John Romano of the Tampa Bay Times believes that while the prolonged sale of Channelside Plaza to the Port Authority prevents an opportunity for the Lightning owner to create a unified vision for Channelside’s success, there could be a window of opportunity for Mr. Vinik as he states:

[Vinik] has too much invested in the Tampa Bay Times Forum and 20 acres of surrounding property to not be intrigued by the Channelside complex. The Channelside property would allow that entire section of downtown to be developed with a unifying vision. And in a businessman’s sense of timing, Vinik is shutting down his hedge fund next month to devote his attention to hockey and real estate (Romano).

Clearly, the solution that worked for CityPlace could very well be the solution that works for Channelside. Creating a long-term vision and having a commitment from interested parties could be the common denominator for both cities.

The greatest lesson learned from CityPlace’s long-term success and highlighted by ULI’s study is the necessity for government to work alongside private development. The creation of a long term plan, strong political support, government incentive, and private imitative are the foundations for creating a project that will change the course of downtown Tampa’s future. It appears that at least some of these crucial factors have already been set in motion. One must realize that the creation of a successful Channelside retail project can only be one piece of a much larger puzzle that spans across residential, retail, and office property types. Creating an environment for inhabitants and visitors to enjoy should be the central focus of any new development. Whatever new project is implemented, it is the duty of Tampa’s government, developers, and citizens to realize that the success of such an endeavor will take time to implement. Only with collaboration and an eye towards the future can success be realized.

If you are interested in learning more about the results of Urban Land Institute’s Tampa study or if you want to know more about CityPlace in West Palm Beach, I have attached some informative links below.

Joshua Klein is an aspiring commercial real estate attorney currently obtaining a Master of Science in Real Estate at the University of Florida, where he also received his Bachelor of Science in Economics. A resident of Boca Raton, FL, Joshua developed an interest in real estate from an early age as he watched and studied the development, population growth, and real estate cycles that have shaped Florida over the last 20+ years. Joshua’s recent work experience in the industry included being a commercial property manager of a private equity firm in Gainesville. Joshua can be reached via e-mail: JRKlein91@icloud.com.

The “young professionals,” an oft sought after demographic by many municipalities and companies, is commonly defined as a group of young adults, aged 24-34, with a Bachelor’s degree or higher. The current batch of young professionals are a subset of the Millennial generation, a generation that, for the most part, grew up in suburban single family homes with their Baby Boomer parents. The Millennials were hit particularly hard by the economic downturn in the late 2000’s, as evidenced by the fact that their salaries dropped by almost double the amount of the general workforce. (Smith, 1). The economic reality of the last several years has produced a mobile generation that is willing to follow opportunity. So, where are they going? Historically, Tampa has not been a common answer.

Several publications produce lists of top destinations for young professionals using various methodologies. Popular ratings are published by Forbes, Kiplinger, MoneyUnder30, The Atlantic, and others. The surveys use slightly different methodologies to determine ratings, but the common metrics include: median income for young adults, job growth, percentage of young adults in the population, cost of living, and unemployment rate (see Appendix). Several metro areas routinely rank near the top of the various surveys, including: Raleigh/Chapel Hill, NC; Houston, TX; Austin, TX; Washington, D.C.; Seattle, WA; San Francisco, CA; Boulder, CO; and Salt Lake City, UT. By contrast, the major Florida markets typically rank in the middle to the bottom of the survey results.

What factors are holding Tampa back from being regarded as a destination for young professionals? First, the population of the Tampa-St. Petersburg metro area skews older than many of the more highly ranked areas. According to 2012 estimates from the U.S. Census, the median age of Hillsborough County, where Tampa lies, is 36, which is slightly older than that of the top areas on the list. With a median age of approximately 46, Pinellas County, the location of St. Petersburg, has a significantly higher median age than the top destinations. Second, of the Forbes top 200 big companies to work for and top 400 small companies to work for, only one, Sykes Enterprises, is located in the Tampa metro area. More generally, only three Fortune 500 companies are headquartered in the Tampa metro area. Third, the service-based economy of the Tampa metro area was hit particularly hard by the recession of the late 2000’s and the salary to cost of living ratio is lower than in most of the other top areas.

Given the historical factors that have given Tampa a reputation as undesirable to young professionals, the pertinent question for real estate professionals is what does the future hold for this group in Tampa? Notwithstanding Tampa’s checkered past with this demographic, the population metrics point to an increase in the number of young professionals that will reside in the Tampa metro area. For example, unemployment rates for Hillsborough and Pinellas counties have fallen to approximately 7% as of July 2013, as stated by the Bureau of Labor Statistics. This figure is lower than the national rate and is down from a high of over 12% in 2010. Job growth was more than 2% year over year from 2012 through 2013 according to Forbes.com. Additionally, according to Census data, Hillsborough County grew at almost 4% from 2010 through 2012, more than double the growth rate for the United States, and the percentage of 25-34 year olds held steady. Moreover, there has been a more than 1% increase in population aged 20-24, potential future young professionals if they choose to stay in the Tampa metro area. Strong population and job growth are the historic bellwethers for increasing real estate demand.

Additionally, there is evidence that desirable employers will continue expanding in the Tampa metro area due to the favorable business climate. Michael Sasso of the Tampa Tribune recently reported that HealthPlan Services, a company that serves health insurers, recently announced that it will add 1,000 jobs in Tampa. Shortly after that announcement, Mr. Sasso also reported that USAA, a large national insurer, announced that it will be adding over 1,250 jobs to its North Tampa office. Additionally, the Tampa Times recently wrote that Amazon has plans for a new distribution warehouse in Hillsborough County with over 1,000 jobs. Besides traditional employment, Forbes.com recently ranked Tampa as one of the Top 10 cities for young entrepreneurs based on the good availability of capital, low cost of living, and favorable business policies of the area in a ranking authored by Meghan Casserly. Due to their comfort with technology and skepticism of large, traditional employers after the recent recession, entrepreneurial opportunity is likely to play a large part in attracting young professionals over the next decade.

Assuming the favorable demographic and employment trends for the Tampa metro area continue, the questions residential developers must answer are: Where will these new young professionals want to live and what opportunities will there be for urban infill development? So far, research and surveys have shown that Millennials have a much less favorable opinion of car ownership and commuting than their suburb-dwelling parents, the Baby Boomers. (Naughton 3). Rather, they are more likely to want to live in “real” metropolitan areas where they can take public transportation, bike, walk, and use car-sharing services and experience more of a sense of community than can be experienced holed up in a suburban bunker. (Pendall 5). The effect of the urban-dwelling Millennials is particularly evident across the Tampa region in areas such as Channelside, Downtown, Hyde Park, West Shore, and downtown St. Petersburg.

What factors are at play in determining where future growth will be in urban areas with a growing young professional population? Clearly, access to real public transportation is one criteria, something that the Tampa metro area is lacking, but is working to improve. Availability of urban core areas with a reasonable cost of living is something that Tampa does have in spades. Moreover, Tampa does have some quality public schools, which offer a significant savings over private school for those “aging” Millennials that start to have children (over age 30). Another ingredient Millennials seek is an active nightlife scene, with bars, restaurants, live music, something that South Tampa has in abundance. Having coffee shops, gyms and yoga studios, and public spaces, like parks, in walking distance is also important. Finally, a short commute to work is a priority to the car-shunning young professionals of today.

This opportunity for new urban multi-family development has not gone unnoticed. In August, ABC Action News reported that the Tampa City Council approved a 36-story, 380-unit condominium tower in downtown overlooking the Hillsborough River. Additionally, according to company executives, MetLife has plans for a large new apartment building on the corner of its MetWest property in West Shore. Additionally, Mill Creek Residential Trust, a multi-family REIT, has two large apartment projects currently under construction in urban St. Petersburg. Unlike in decades past, it appears that much of the new growth opportunities in the Tampa-St. Petersburg metro area will take place in existing urban areas.

Key market factors to consider when performing analysis for residential development will continue to include the classic markers, such as job and population growth. However, while those factors tell the story of general demand in a region, residential developers would do well to consider the desires and characteristics of the new generation of young professionals. Due to the historic lack of attention to this group in the Tampa metro area, there is great opportunity for creating urban infill multi-family developments. The reasonable cost of living in the area, exciting nightlife, and favorable job situation all mean that revitalization of neglected urban areas, long ignored by Baby Boomers and Generation X, is now realistic. The real New Tampa might just be the old one, if the job opportunities continue to come.

About the Guest Author:

Jason Quick is a native of Southwest Florida and graduate of UCF and the Wake Forest University School of Law. He is currently a Master of Science in Real Estate candidate at the University of Florida and resides in Tampa, Florida with his wife, Jillian. After spending several years as an attorney with a federal agency in Raleigh, NC and Philadelphia, PA, Jason made the decision to return to Florida and pursue his passion for real estate as a full-time career. His interests include leasing and brokerage as well as residential development. Jason can be reached by email at jasondquick@gmail.com.

Casserly, Meghan. “Where Are New York And San Francisco On The Top 10 Cities For Young Entrepreneurs?,” Forbes.com, http://www.forbes.com/sites/meghancasserly/2013/04/29/where-are-new-york-and-san-francisco-on-the-top-10-cities-for-young-entrepreneurs/. 29 April 2013.

Highwoods Properties has plans to renovate the LakePointe One and LakePointe Two buildings at the Tampa Bay Park. The renovations will focus on the interior and exterior of the two building. Per the VP of Highland Properties, the renovations will feature an urban collaborative and pedestrian friendly environment…Continue Reading

East Tampa Potential Grocery Store Location

The Tampa City Council members voted whether to buy the properties located at 2925 21st Street and 2924 21st Street. Local property tax revenues from the East Tampa special district. The city has been purchasing parcels along 21st and 22nd streets for 6years with the purpose of redesigning the corridor to attract commercial developers, like Save A Lot who are interested in building a store in that area…Continue Reading

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Florida in Top 3 For US Foreclosure Activity

According to RealtyTrac, Florida is in the top three for foreclosure activity in the United States. The Sunshine States foreclosure rate increased 7% in the 1st quarter, and increased 17% from 2012′s 1st quarter. Seven Florida cities were in the top 10 highest metro area foreclosure rates in the 1st quarter. The City of Tampa is #5 with one in 100 housing units in foreclosure… Continue Reading…

The California based investment company, MIG Real Estate LLC, has purchased the Hilton Garden Inn Tampa location in East Tampa/Brandon Area. This third hotel acquisition by MIG since September 2012 …Continue Reading

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Lender has taken possession of sale through foreclosure. Previous owner is appealing the sale

Sq Ft

Multiple Parcels

Prior Sale Amount

Multiple Sales Amounts

Prior Sales Date

8/27/2004

“While we believe the sales information provided in this site is from a reliable source and we believe it to be accurate, we do not warranty its accuracy. Please conduct your own due diligence when purchasing or leasing commercial property.”

Contact us at 813.514.1070 for more information on Sales and Leasing Commercial Property in Greater Tampa Area

“While we believe the sales information provided in this site is from a reliable source and we believe it to be accurate, we do not warranty its accuracy. Please conduct your own due diligence when purchasing or leasing commercial property.”

Contact us at 813.514.1070 for more information on Sales and Leasing Commercial Property in Greater Tampa Area